Two years ago, I moved from being a venture capitalist to an entrepreneur in India. Although I had started my business in the US, the entrepreneurship journey in India was very different. Here entrepreneurship is like standing in a sandstorm — you do not know your path ahead and are constantly buffeted by strong winds. In the US, it is more like a foggy day — the path ahead is unclear, but you have a strong support system.

One key cog of entrepreneurship seems to be doing more to hinder than help startups in India — venture capitalists. Here’s why:

Herd Instinct

Most VCs in India look sideways at their peers to take investment decisions. A lack of passion to back breakthrough ideas translates into a lack of commitment, a lack of understanding of businesses and a lack of long-term perspective. For example, while more than $500 million was invested in e-commerce companies in India in 2011, it fell to half of that in 2012 and less than $100 million in 2013.

Just as quickly as this bubble grew, it burst and now we have me-too e-commerce sites struggling to raise their first round of VC funding. A similar pointless wave came in the mobile sector in 2005-08, in the healthcare sector in 2006-08, in the financial sector in 2007-10 and the education sector in 2006-09. Most of the companies have either closed down or have been forgotten by VCs. The sector that is perhaps comparable to e-commerce currently is microfinance, which saw a rush of investments till 2010, but where one-time high-fliers are now almost forgotten.

No Connect

Given that most VCs have rarely been entrepreneurs or entrepreneurs outside India, it is difficult for people running start-ups to connect with them. In fact if you analyse the team background of some of these VC funds, more than 50% have an investment banking or consulting background.

Sometimes a simple statement from a VC like, “Hey, I have been in similar mess and this is how I responded”, can help a lot.

Most VCs think little of arriving late to a meeting and looking at their phones in the middle of it, showing disrespect to the entrepreneur. They’re unprepared too — a majority of them would not even have opened the business plan and expect you to narrate a story that can trigger a few standard questions from them. Fifteen minutes into a pitch with a top VC, he started quizzing me on financial services, when I was pitching my e-commerce business. A meeting with a VC is enough for entrepreneurs to feel discouraged and demoralised.

No Guts, No Glory

Most Indian VCs have a short-term outlook and like entrepreneurs who pretend to think that way. In India, companies take time to scale up simply because of the resource constraints that are mostly not there in the US. Nine out of 10 technology entrepreneurs I have met told me that VCs were clueless about what they were doing and told them to copy a US-based idea and implement it in India. Very few have the guts to support innovation and make an investment in which their peers have not invested. Recently, I came across a startup, Securasi, which is building a security product for Dropbox customers. This idea has global appeal but it has been rejected multiple times in favour of e-commerce companies.

My aim here is not to attack Indian VCs, but to help trigger a change that can help create billiondollar companies. VCs can be an anchor in a storm, rather than a deadweight that sinks startups.

[Editor’s Note: This is a guest post by Manoj Gupta, the founder of Craftsvilla.com and a former venture capitalist at Mumbai-based Nexus Venture Partners]

Note: The views and opinions expressed are solely those of the author and does not necessarily reflect the views held by Inc42, its creators or employees. Inc42 is not responsible for the accuracy of any of the information supplied by guest bloggers.